As large numbers of recipients leave the welfare rolls, there is widespread
interest in their circumstances: Are they working? What is their
income? Are they returning to welfare? Are they receiving assistance
and supportive services through other programs?

In September 1998, the Office of the Assistant
Secretary for Planning and Evaluation (ASPE), Department of Health and
Human Services, awarded approximately $2.9 million in grants to study the
outcomes of welfare reform for individuals and families who leave the TANF
program, who apply for cash welfare but are never enrolled because of
non­financial eligibility requirements or diversion programs, and/or
who appear to be eligible but are not enrolled. The grants were awarded
to ten states and three large counties or consortia of counties under a May
1998 competitive grant announcement. A grant was also made to South
Carolina under a different program announcement to expand an on-going project
to include a similar study of families leaving
TANF.(1)

Ten of the FY 1998 ASPE-funded grantees have released interim reports that
use linked administrative data sets to track families who left welfare in
late 1996 or 1997. Preliminary findings from these administrative data
linkages are presented in this paper, which also includes findings from an
administrative data study of AFDC leavers in Wisconsin funded by ASPE through
the Institute for Research on Poverty. These eleven reports provide
interesting preliminary findings about former AFDC/TANF recipients in the
areas of employment, earnings, returns to cash assistance, and program
participation in Medicaid and food stamps. More comprehensive findings,
including information gathered through surveys of former TANF recipients,
will be presented in the grantees' final reports, forthcoming over the next
twelve months.(2) This paper expands
and updates findings from earlier reviews of a subset of these interim reports
(DHHS/ASPE, August 1999; DHHS/ASPE, October 1999).

The eleven studies included in this review include: Arizona; Cuyahoga County
in Ohio; the District of Columbia; Georgia; Illinois; Los Angeles in California;
Missouri; New York; San Mateo County in California; Washington; and
Wisconsin. Although it is difficult to compare findings across studies,
comparisons among these ASPE-funded studies are facilitated by the adoption
of a common definition of the "leaver" study population as "all cases that
leave cash assistance for at least two months." This definition excludes
cases that re-open within one or two months, because such cases are more
likely closed due to administrative "churning" than to true exits from
welfare. For the most part, the studies focus on single, female adult
parents, although some grantees define the study population to include a
small percentage of fathers and/or other adult relatives, as shown in
Table 1.

Adults without Social Security number (2%); closed due to move to other
state (3%); without children

D. C.

Q4 1997

3/97

TANF

2

x

Notes:

The leaver population includes "sanctioned cases" if the state imposes full
sanctions that close the entire case. Eight of the study sites have
partial (adult) sanctions, where the adults are sometimes sanctioned off
the case while the children remain. The adult leaver is included in
the study population of leavers in three studies (Georgia, Illinois, and
Missouri), excluded in three studies (Los Angeles, New York, and Washington
state) and studied as a separate population in two studies (Cuyahoga and
San Mateo counties).

* Although the findings here are for single adult
leavers off assistance for two months, the grantees' individual written reports
provide additional findings, including one-month leavers (Arizona); two-parent
leavers (Arizona, Illinois, Missouri, New York, San Mateo and Washington);
adult leavers whose children remain on assistance (Cuyahoga and San Mateo);
and closed child-only cases (Georgia and San Mateo).

In addition to using a similar definition of a "leaver," the ASPE-funded
studies examine a similar time period, generally tracking families leaving
AFDC/TANF in late 1996 or early 1997. The Wisconsin study, however,
looks at an earlier time period, while the District of Columbia study looks
at a later time period. All studies are in the process of collecting
data on at least one additional cohort of leavers who left welfare after
full implementation of TANF. This summary of findings from the interim
reports, however, focuses on the early leavers  those who left
welfare in the last months of AFDC, the early months of TANF implementation,
or during the transition between the two programs.

Cross-state differences in TANF policies are likely to cause differences
in the leaver populations across states. A state with a policy of
sanctioning non-compliant families off TANF, for example, is likely to have
a different leaver population than a state that imposes partial sanctions
that do not result in a case closure. Also, the level of earnings which
leads to case closure differs from state to state, depending on maximum benefits
and earnings disregard policies. Work requirements, time limits, and
differences in Medicaid and other program policies also contribute to the
varied experiences of leavers in different parts of the country.

Finally, caution must be made in interpreting cross-site differences because
of differences in the underlying economic, social and demographic conditions
of the states and counties under study.

A recipient is considered "employed" if she or he has any earnings in UI-covered
employment within the state, with the following exceptions: the Cuyahoga
and Los Angeles studies require a minimum of $100 per quarter, and the Washington
study counts earnings reported to the welfare system in addition to earnings
in the UI system.

Most studies reported employment rates between 50 and 60 percent one quarter
after exit, although employment rates were below 50 percent in one site (Los
Angeles, based on preliminary data), and above 60 percent in two sites (Wisconsin
and Georgia). There was a slight dip in employment rates in the second
quarter after exit in most sites. In half the sites, this trend was
reversed, and employment rates returned to initial levels by the fourth quarter
after exit.

Over the twelve-month period, some former recipients lost their jobs, while
others found new employment, resulting in cumulative employment rates of
62 to 75 percent, measured as those who were ever employed within the first
twelve months of exit.

Only about 35 to 40 percent of leavers were employed in all four quarters,
according to the three studies reporting this statistic.

Employment rates were defined in a similar manner across the ASPE-funded
studies, as the percentage of leavers with positive earnings in the quarterly
earnings records maintained by the state's unemployment insurance (UI)
program. Although most jobs are covered by the state UI systems, some
jobs are omitted, such as self-employment, employment in the military or
federal government, certain agricultural employment, informal employment,
and jobs over state boundaries. These employment rates, therefore,
are likely to be under-estimates of employment rates as compared to employment
information gathered through surveys of former recipients.

Mean quarterly earnings in the quarter immediately following exit from TANF
ranged from $2,185 to $3,414, according to administrative data from the
Unemployment Insurance system for leavers in nine study areas. (See
Table 3.)

Excludes leavers without earnings in the quarter. Earnings are reported
in nominal dollars, with the exception of San Mateo (November 1998 $).
Illinois did not report mean earnings; New York did not report median earnings;
and the District of Columbia did not report any earnings data.

Median quarterly income ranged from $1,996 to $3,248. In every location,
earnings steadily rose over the course of the year following exit.
Earnings were slightly higher in New York, San Mateo County, and Los Angeles.

Earnings were measured for those leavers that found employment (i.e., leavers
with positive earnings in a quarter). Grantees generally reported earnings
in current or nominal dollars, except for San Mateo County, which presented
earnings in November 1998 dollars.

Data from eight reports suggest that between 5 and 20 percent of leavers
were receiving welfare again one quarter after exit, as shown in
Table 4. These leavers generally re-entered in
the second or third month, since cases that re-open after one or two months
were excluded from the study population.

Grantees measuring program participation by month  denoted by
(m)  are more likely to report lower program participation than
grantees measuring participation over a three-month quarter.

Also, there is a potential one-month discrepancy in how grantees define months
and quarters "post exit," because some grantees define "month of exit" as
the last month of benefit receipt, while others define it as the first month
without cash assistance.

The proportion of former recipients receiving AFDC/TANF increased to between
10 and 28 percent at two quarters after exit, and then rose more slowly in
most areas, reaching 12 to 29 percent one year after exit. Because
some people come back to welfare for a few months and then leave again, the
proportion that ever returned for at least one month over the first twelve
months after exit was somewhat higher, ranging from 23 to 35 percent.

Some of the variation in receipt of cash assistance is due to measurement
differences. Most importantly, some grantees measure program participation
by month, while others measure it as receipt over any of three months in
a quarter. Quarterly measures are likely to result in higher participation
rates because of the longer time period for observing benefit receipt.

Rates of Medicaid enrollment for former AFDC/TANF recipients varied more
across grantees than the employment, earnings, and recidivism findings.
Three months after exit, the enrollment rate for adult leavers across the
nine studies that reported this measure ranged from 24 to 76 percent, but
was more typically 35 to 60 percent. (See Table 5.)

These rates measure enrollment of the single adult head who left TANF, except
where noted as rate of leavers whose "children are covered" or where "anyone
on case" (child or adult) is covered. Washington data are not available
for Q4 1996 leavers; data shown here are for Q4 1997 leavers.

Also, as noted in Table 4, measures of participation
by month  denoted by (m)  are likely to be lower than
measures of participation over a three-month quarter; and "month of exit"
may mean first month without cash assistance, or last month receiving cash
assistance.

Among those grantees that reported Medicaid enrollment among both adult leavers
and their children, enrollment was higher for children in one site (Missouri)
but, surprisingly, was not significantly different in the other two (San
Mateo and New York). In some study areas, participation in Medicaid
declined over time in the year after exit from AFDC/TANF, dropping by as
much as 10 to 20 percentage points for adult leavers between the first and
fourth quarters after exit. Rates remained relatively stable, however,
in three of the studies. A substantially higher percentage of leavers
were ever enrolled in Medicaid than were enrolled in each of the four
quarters. In Arizona, for example, administrative data show that only
about 50 percent of leavers were enrolled in Medicaid in any particular month,
but 85 percent were enrolled at some point in the first year after exit.

A number of factors contribute to the diversity in the Medicaid findings.
The effect of differences in unit of analysis and time period are evident
in New York, which reported four different rates, ranging from 34 to 45 percent,
depending on whether enrollment was measured for adults, children or any
family member, and whether measured by month or quarter. In San Mateo,
the Medicaid enrollment was limited to data within the county of San Mateo,
which might help explain why these rates were lower than those that tracked
recipients within an entire state. In addition, both TANF and Medicaid
eligibility rules and application policies also differ across the various
states.

A few studies reported Medicaid enrollment among "continuous" leavers, that
is, leavers who do not return to cash assistance. (See
Table 6.)

Washington data are not available for Q4 1996 leavers; data shown here are
for Q4 1997 leavers.

Also, as noted in Table 4, measures of participation
by month  denoted by (m)  are likely to be lower than
measures of participation over a three-month quarter; and "month of exit"
may mean first month without cash assistance, or last month receiving cash
assistance.

In general, Medicaid enrollment is lower among continuous leavers.
In Illinois, for example, 23 percent of continuous leavers were enrolled
in Medicaid four quarters after exit, as compared with 40 percent of all
leavers. One reason for higher enrollment among all leavers is that
some of them are re-enrolled in Medicaid at the time of their return to
TANF. In addition, it may be true that continuous leavers have higher
rates of private health insurance coverage than other leavers, but such
information is not available through administrative data.

Most studies found that between one-third and one-half of former recipients
of cash assistance received food stamps immediately after exit. (See
Table 7.)

Table 7.
Percentage of Leavers Receiving Food Stamps

Grantee

Exit Quarter/
month

1st Qtr
post exit

2nd Qtr
post exit

3rd Qtr
post exit

4th Qtr
post exit

Ever receiving
within 1 year

All Leavers

San Mateo

9.3

15.4

13.4

14.1

27.5

New York

26.0

New York (m)

21.0

D. C. (m)

69.6

33.9

35.0

34.2

34.3

Illinois (m)

35.5

39.4

37.5

34.5

Arizona (m)

38.0

37.3

36.7

34.2

67.2

Cuyahoga

42.5

42.2

41.2

39.4

57.3

Washington

91.0

46.0

42.0

40.0

36.0

Wisconsin

89.7

51.3

45.8

42.5

40.0

62.8

Missouri

63.0

57.3

46.7

42.7

40.1

Continuous Leavers (who have not returned to TANF):

Cuyahoga

34.7

Illinois

21.8

22.0

22.7

19.6

D.C.

68.6

29.4

27.1

23.1

20.4

Notes:

Washington data are not available for Q4 1996 leavers; data shown here are
for Q4 1997 leavers.

Also, as noted in Table 4, measures of participation by month 
denoted by (m)  are likely to be lower than measures of participation
over a three-month quarter; and "month of exit" may mean first month without
cash assistance, or last month receiving cash assistance.

By one year after exit, these participation rates generally fell to between
one-fifth and two-fifths. One exception was the San Mateo study, which
found only 10 to 15 percent of former TANF recipients in the food stamp
administrative data base in any quarter. In general, the percentage
of leavers participating in the Food Stamp program appeared to be lower than
the percentage who received Medicaid.

Among the few studies reporting food stamps participation rates for continuous
leavers, those who did not return to TANF reported rates of only 20 to 30
percent. Participation rates in the Food Stamp program are more noticeably
affected by the unit of measurement than other program participation rates,
probably reflecting the short-term nature of food stamp participation for
many households. Participation rates one year after exit, for example,
were 21 to 35 percent when measured monthly, compared to rates of 26 to 40
percent among grantees measuring program participation across a three-month
quarter. The exception is San Mateo, which measured low rates despite
observing participation over a three-month quarter. Possible explanations
for the low measure in San Mateo include: higher incomes among the leaver
population (because eligibility limits and maximum benefits are higher than
average in California), less active food stamp outreach, or technical measurement
challenges with the administrative data.

The employment, recidivism, and program participation findings summarized
in this paper are generally consistent with findings from other studies of
leavers. Comparisons across studies are problematic, however, because
of the many differences in study populations, time periods studied, sources
of data, response rates, and research methodologies. Both the General
Accounting Office and the Urban Institute have produced summary findings
of state-funded studies of leavers, which present findings and discuss the
challenges of cross-state comparisons.(3)

Another source of comparison is an August 1999 Urban Institute report which
uses data from the National Survey of America's Families (NSAF) to study
former welfare recipients. Again, direct comparisons are difficult
because of the difference in data source (surveys rather than administrative
records) and in study population (national sample of anyone who left welfare
between 1995 and 1997 and remained off welfare at time of interview in 1997
compared with a state sample of leavers who remained off welfare for at least
two months). With these caveats in mind, it is interesting that the
Urban Institute study found that of those continuous leavers not receiving
welfare benefits at the time of the interview, 61 percent were employed and
an additional 14 percent were not working but had a spouse or partner
employed. In addition, 31 percent of all former recipients not receiving
TANF were participating in the Food Stamp program. A third of this
population was enrolled in the Medicaid program, and nearly half had children
enrolled in Medicaid. Finally, of all families who left welfare between
1995 and 1997, 29 percent had returned to welfare by the time of the interview.

Julnes, G., Halter, A., Anderson, S., Frost-Kumpf, L., Schuldt, R., Staskon,
F., and Ferrara, B. (March 2000). "Illinois Study of Former TANF Clients,
Interim Report: Analysis of Administrative Data." Institute for
Public Affairs, University of Illinois at Springfield and School of Social
Work, University of Illinois at Urbana-Champaign.

Rockefeller Institute, New York State Office of Temporary and Disability
Assistance, and the New York State Department of Labor (December 1999).
"After Welfare: A Study of Work and Benefit Use After Case Closing."
Revised Interim Report. See also Interim Report issued in July 1999.

Cancian, M., Haveman, R., Kaplan, T., and Wolfe, B. (January 1999).
"Post-Exit Earnings and Benefit Receipt Among Those Who Left AFDC in
Wisconsin." Institute for Research on Poverty, University of
Wisconsin-Madison. (NOTE: Employment and program participation
rates in this summary are drawn from a supplemental table provided to ASPE
in June 1999. Adjustments made to the rates in the original study made
them less comparable to rates in other studies.)

1. In FY 1999, ASPE awarded an additional $2.6
million in grants to state and county agencies to study welfare outcomes,
including $1.8 million in grants for new projects (primarily focusing on
welfare applicants and diversion) and $0.8 million in continuation grants.
Findings are not yet available from this second round of welfare outcomes
grants.

2. Final reports have been released by Arizona
and Washington, with reports from Missouri and Illinois anticipated later
in spring 2000. See Reports for a copy of
the Arizona report and others as they are available.

3. General Accounting Office (Welfare Reform:
Information on Former Recipients' Status: GAO/HEHS-99-48, April 1999)
and the Urban Institute (Where Are They Now? What States' Studies of
People Who Left Welfare Tell Us: A Product of Assessing the New Federalism,
Series A, No. A-32, May 1999).